Agricultural Knowledge and Innovation System (AKIS) as a Tool to Increase Effectiveness, Efficiency and

Sustainability in Agriculture

Krisztián Kis, PhDkisk@mk.u-szeged.hu

University of Szeged, Faculty of EngineeringSzeged, Hungary

http://www.mk.u-szeged.hu/

’The Position of Agriculture in Regional Development’ERASMUS Intensive Programme (EIP 2014: 27/04/2014 – 10/4/2014)Faculty of Economics and Management of SUA in Nitra, Slovak Republic

Keywords of the presentation

• System

• Agriculture

• Agribusiness

• Adaptation

• Information, knowledge

• Extension, cosultation

• Competitiveness

• Ploicy (agricultural policy)

• Multilevel life-cycle model � policy-programme-project

integrated approach

• Innovation

• Agricultural Knowledge and Innovation System (AKIS)

The fit of agriculture and agricultural extension (connectedness) – the

systematic approach

Introduction

• The economy means

– phisical, financial, natural and human resources,

– material and immaterial goods,

– economic activities, and

– broad and complex relations of these.

• Links or realitions exist between

– things,

– activities,

– things and activities,

– Things and people and

– people and people.

• The economy itself is a complex entity, a complex and organic system.

– It is part of the society (inseparable from it) � one of its most important and most comprehensive subsystem

– The economy is also tied to the natural environment as well (e.g. resources and pollution).

Bedő-Ivanyos-Tomcsányi-Várday (1994)

Introduction

• The agriculture is one of the branches of the national economies,

– with its production and service activities,

– through its inputs and outputs,

– is vertically (agribusiness) as well as

– horizontally (multifunctional agriculture) connected to larger systems.

• Nowadays, in the era of information or in the period of knowledge-based economy, only the enterprises can be prosperous which are able to adapt, react to the new challenges, or which are able to manage the changes in the socio-economic and natural environments.

• The importance of adaptation is rooted in biology.– According to Charles Darwin’s theory of evolution: only the species having the best

adaptability can survive in the process of natural selection. ����������������������������������������������������

Kis and Gál (2012)

Introduction

• This is also true for organizations (including businesses

enterprises, including farm businesses) that their decisions and

continuous communication with the environment could ensure

their survival. (see Planning (decision) �implementation

(behavior)�result (objective) logical link)

– In doing so, the key question is whether they can respond to environmental stimuli, they can adapt to changes in the environment, they are able to obtain the resources from their environment necessary for their survival.

Bakacsi et al. (1996)

“It is not the strongest of the species that survive, nor the most intelligent, but the ones most

responsive to change.”

• The words of Charles Darwin are strikingly relevant to the agriculture as well.

• Agricultural enterprises (farms) are in the midst of a pervasive and radical change �

• Organisations must respond to change in a way that helps shape the future of agriculture or find themselves in the

precarious position of obsolescence.

Keywords: knowledge and innovations.

Introduction

• The success of the adaptation of agricultural enterprises largely

depends on the preparedness of managers, farmers and agricultural

labor force.

• In this regard, the presence or absence of knowledge, skills and information can be highlighted.

– At the current level of socio-economic development the formers can be taken into account as the key resources of organizations.

• Accordingly, the presence or absence of information and knowledge are large differentiating factors between farms or

ag. enterprises.

Kis és Gál (2012)

About consultation (advising)

• The essence of advising is to help and support farmers by

transfering or distributing information to them.

• So, agricultural advising is about knowledge and information sharing.

• In this way, agricultural consulting should be a service that helps or assists for farmers with effective communication and learning

techniques to enhance their skills and knowledge in order to increase their adaptability.

A few words about systems and

system theory

• A system is a purposeful collection of interrelatedcomponents that work together to achieve some objective.

• Many types of systems: physical, political, biological, social, …

• A complex system is any system:

– That involves a (large) number of elements, arranged in structure(s) which can exist on many scales

– These elements interact locally: every element is connected to every element in the system, even indirectly

– Structures go through a process of change not describable by a single rule or reducible to a single level of explanation

– Features emerge that cannot be predicted from the current description of the structure(s)

Kaisler and Madey (2009)

• Complex: consisting of interconnected or interdependent parts

– Not easy to understand or analyze

– The system is not a simple sum of its components (elements) and connections (links) between components, but it is a new quality, it is able to perform higher functions and it has a qualitatively new (integrated) features. � � � The whole is greater than the sum of its parts.

• Simple systems: A pendulum, a spinning wheel, an orbiting planet

• Complex Systems: An economy, a local community, families, the human body—physiological perspective, a person—psychosocial perspective, the brain, the ecosystem of the world

• For simple (linear) systems:

– a small change to a system’s components � a small change at the system level

• For complex (non-linear) systems:

– a small change to a system’s components � large/small/no change at the system level

Kaisler and Madey (2009)

Features of systems

• According to von Bertalanffy (1968) "a system, wheter it is a

living organism or a society, is characterized by:

– wholeness,

– growth,

– diversity,

– hierarchy of arrangement,

– dominance,

– control and

– competition. ������������������������������������������������������������������������������������������������������������

Competition,

competitiveness of enterprises and

industies

The Porter Diamond

a

a

e.g. education, research, extension, advising

Based on Porter (1990) http://en.wikipedia.org/wiki/Diamond_model

Related and supporting industries

Agriculture ��� Agribusiness;

Multifunctional agriculture

What is agribusiness? (Food and fibre industry)

• Consists of those business entities that are involved in the

supply of food and fiber to consumers.

• Agribusiness encompasses all activities from the „paddock to the consumer” that are relevant to the eventual

(ultimate) production, transformation / value adding, distribution

and retailing of food, fibre and associated products.

• Agribusiness is alternative nomenclature for „food or fibre systems” - where the system encompasses the complex chain

of interactions that facilitates the production of commodities,

their transformation and eventual delivery to the consumer.

• The Agribusiness Value Chain is another term used to

describe agribusiness.

Sectors of the Agribusiness

1. FARM INPUT SUPPLY SECTOR

2. FARM SECTOR

3. PROCESSING & MANUFACTURING SECTOR

4. WHOLESALE & RETAIL SECTOR

5. CONSUMER

The capture the full meaning of the term “agribusiness” it is important because � these sectors

are interrelated parts of a system in which the success of each part depends heavily on the proper functioning of the others.

������������������������������������������������������������������������������������������������������������ ��������

Sectors of the Agribusiness

The Nation’s food and fiber system (Agribusiness) consists of various sectors that provide food and fiber products to their ultimate consumer.

Knowledge inputs

• The key input of Agribusiness Value Chain (agribusiness) is knowledge.

Knowledge inputs into the agribusiness value chain include:

• Agricultural and agribusiness education / training,

• The ”services” sector, including consulting and advisory services, and

• Agricultural research and development.

Sectors, components of the Agrobusiness

Five main components can be distinguished within the chain:

• 1. Manufacturing of agricultural inputs, equipment and devices;

the provision of business and community services for

agriculture (supply sector)

– The input supply sector, supply farms with seed, fertilizer, pesticides, buildings, machinery, equipment, devices etc. This includes services thatimprove the effectivenes, efficiency and sustainability of agriculturalproduction, such as the agricultural (vocational, higher) education, research, consultancy, etc.

• 2. Agricultural production

• 3. Manufacturing of food and non-food products

• 4. Wholesale and retail trade

• 5. Meal and catering

The structure and relations of agribusinessThese activities producing goods and services for production (square) and consumption (oval).

Kriesel és Doherty (2000)

Agricultural

production

Input trade

Input

manufacturing

Processing

Wholesale

and retail

trade

Meal and

cateringFood away

from home

Food at

home

Export

Agribusiness and multifunctional agricultureThe vertical and horizontal relations of agriculture

MULTIFUNKCIONÁLIS MEZŐGAZDASÁG

Ellátó ágazatok

Társadalom,

kultúra

Mezőgazdasági

nyersanyag

termelés

Táj-, természet-, környezetvédelem

Élelmiszer-feldolgozás

Élelmiszer-kereskedelem

FOGYASZTÓ

AGRIBUS

INESS

Katonáné Kovács (2006)

Consumer

Food trade

Food processing

Production of

raw materials

Supplying sector

Landscape, nature

and environmental

conservationLocal culture

and society

MULTIFUNCTIONAL AGRICULTURE

Changing values – Changing agribusiness

• As a resoult of the socio-economic development changes occur in the horizontal relationship of agriculture, in which

the environmental and social functions of agriculture are more and more appreciated by the society. ��� see the case of

public goods associated with agriculture and advising

• In order to cope with challanges agriculture face with, new

way of thinking, a paradigm shift are needed, both at the level

of activities and in the agricultural and rural development policy, as well. ������������ see policy traits (characteristics of public policy

related to agriculture); and the policy-programme-project integrated approach � Multilevel life-cycle model

Agricultural advising and environmental quality

RISE Task Force (2009) See Negative and Positive Freedom!!!

The case of

state intervention

Freedom: Negative and Positive

• There are two different ways of viewing freedom:

– Negative freedom

– Positive freedom

• One approach sees freedom in "negativ" terms, which means

there are not any restraints or restrictions that prevent one

person doing one thing or another.

• In contrast, the "positive" view of freedom focuses on what a person can choose to do or achieve. It is concentrating on

freedom for doing something. It is about freedom of choice, it

sresses the importance of capabilities and people's capacities

to act. (It is about rights and opportunities.)

• Empowerment is about strengthening of positive freedom, to provide tools for increase abilities and to make choices possible.

Agricultural advising and environmental quality

• There can be little doubt that information and advice are critical to the process of changing practices which lead to negative environmental effects.

– If businesses (farmers) can see (understand) the evidence of the cumulative effects of their actions, and in particular if they can comprehend that environmental degradation is not in the long run interests of their own business they may be more likely to respond constructively to advice and exhortation (motivation).

– In these cases voluntary action by business organisations, accompanied by advice and information provision, can be more effective, thus, a preferable approach to strict regulation.

RISE Task Force (2009)

About policy

(The agricultural policy is one of the public policies,

which is a common policy as well (see CAP: Common

Agricultural Policy)

What does the class think policy is?

Some words about policy without going into details…

• Public policy affects each citizen in hundreds of ways, some of them familiarand some unsuspected.

• The term public policy always refers to the actions of government and the intentions that determine those actions, but it is always a public issue(!).

• Making policy requires choosing among goals and alternatives, and choice always involves intention.

• Policy is seldom a single action, but is most often a series of actions coordinated to achieve a goal.

• A government could be responsible for hudreds of different policies, like agricultural policy.

• Making public policy is extraordinarily complex.

• It involves public opinion, media attitudes, expert ideas, active citizens, business and labor leaders, elected representatives, presidents and governors, judges, and bureaucrats.

C. E. Cochran, L. C. Mayer, T.R. Carr and N. J. Cayer (2009)

• Policies are created to solve problems in society. – Before a policy issue is defined or adopted, a problem of public concern

must be perceived.

• Individuals, families, firms, political movements, organized groups, governments, and agencies of governments all participate in the universal activity known as policy (Halcrow, Spitze, and Allen-Smith, 1994).

A Policy can be defined as:

• A plan or guiding principle (chosen from a set of alternatives),

• implemented by an entity (such as the government),

• to achieve a goal.

• The definition identifies three important traits of a policy.

• A policy must have

– 1) a goal,

– 2) a guiding entity (such as the government), and

– 3) a plan.

• The goal is what the policy is trying to accomplish.

• The entity is the group of people that will create and enforce the policy.

• The plan is a way the policy is implemented to achieve the desired goal.

• Ideally a policy (e.g. ag. policy) includes the three traits identified above and addresses some important societal goal.

• Public policy related to agriculture could address many problems including

– productivity, land use, use of natural resources, functioning of agricultural

markets, social and economic cohesion in rural areas etc.

Traits of a policy

The topic of our

discussion

?

Halcrow, Spitze, and Allen-Smith (1994 )

Policy-programme-project integrated approach ���� Multilevel life-cycle model

Policies create programmes (that are the result of policy processes);

Programmes induce projects ���� ���� ���� Programmes can be implemented

through projects; Realization of programmes leads to the

implementation of policies

Stages of the Policy Process (Policy making)

C. E. Cochran, L. C. Mayer, T.R. Carr and N. J. Cayer (2009)

Policy-programme-project

• Public policy: Strategic objectives and priorities.

• Programme: Development plan in line with one or more objectives or priorities, which is implemented by a number of interrelated projects.

• Project: A series of activities planned and carried out by final beneficiaries in the frame of a certain programme.

• The life-cycle model is an integrated approach to policy-making.

• This model consider public policy actions at various levels – policy, program, project – as continuous and repetitive series of cycles; where the cycles built up of phases based on each other.

• The program can be perceived as a series of project cycles; the policy can be understood as series of programme cycles.

• Multilevel life-cycle model

Probléma felismerése

Probléma felismerése

Probléma felismerése

Megvalósítás monitoring

Megvalósítás, monitoring

Megvelósítás, monitoring

Helyzetelemzés, koncepcióalkotás

Helyzetelemzés, célgenerálás

Helyzetelemzés, célgenerálás

Stratégia kidolgozás

Program kidolgozás

Projekt kidolgozás

Értékelés korrekciók

Lezárás, értékelés

Lezárás, értékelés

Szakpolitika

Program

Projekt

Multilevel life-cycle model

Recognition of

problemSituation

analysis

Policy formation

and adoptionImplementation

and monitoring

Evaluation and

correction

Policy

Programme

Project

Recognition of

problem

Recognition of

problem

Situation

analysis

Situation

analysis

Policy formation

and adoption

Policy formation

and adoption

Implementation

and monitoring

Implementation

and monitoring

Evaluation and

correctionEvaluation and

correction

Agricultural Knowledge and Innovation System(AKIS)

• Agriculture and innovation go hand in hand since agriculture was invented some 10.000 years ago.

• It had and still has to adapt over time to the new challanges �

innovation is a means of the adaptation process � innovation

means harnessing existing and new knowledge � � � � � � � � � � �

� to be able to react or response challanges, while harnessing knowledge �all in all to be able to adapt.

• Farming and agro-industry need knowledge from manydifferent sources to compete in a globalised world, and tocope with adaptation.

• Farming is much more diverse than in the past.

• New knowledge is generated by farmers, researchers (basicand applied) and private companies.

• The old linear model of technology transfer (from scientiststo the users called technology-driven) is therefore outdatedand should be replaced by an interactive model of networking systems, which integrate knowledge production, adaptation, advice and education.

• The sytem or network approaches (thinking) provide an opportunity to integrate the components of the innovation system.

• The systems of innovation thinking is the ground of the concept ofAgricultural Knowledge and Innovation System (AKIS).

• AKIS is a useful concept to describe a system of innovation (with emphasis on the organisations (actors) involved, the links and interactions between them)

• Although the Extension (Farm Advisory) system, Education and Research are often stressed, it is important to realise that there are many more actors in the food chain that directly influence the decision making of farmers and their innovations (see figure next slide �).

Actors in the AKIS directly relevant for agricultural innovation in

the food chain

EU SCAR (2012 )

Note: A leading innovation systems based on well-functioning, interactive relationship between actors in the innovation process.

• Leading innovation systems are based on well-establishedrelationships among defferent actors involved in the process.

• So it is important to promote (the formulation and)

development of (existing) AKIS in oder to help farmers in

responding the challanges in a better way (effectively, efficiently and sustainable) � ADAPTATION

• Innovation is first of all the responsibility of businesses.

• Innovation expresses the adaptation of businesses to the changing environmental conditions � the basic precondition of farmers’ success is adapting to changes

• Innovation is an essential tool for adapting to change � � � Thus, innovation is a core subject of any business strategy.

• But it is a government responsibility too. (to promote innovation)

• Why?

• Because innovation has not only effect for those who innovate (innovators) ���� (1) others are also gaining; (2) and it contributes to mitigate negative spillover effects

• (See externalities or spillover effects)

– (Spillover effects are externalities of economic activity or processes that affect those who are not directly involved)

• Positive externalities � innovation has not only benefits for those who innovate, but also others gain (e.g. future innovators or adaptators and the economy at large with a better competitive position and in the long run more jobs and higher incomes)

• Negative externalities � (one of the policy reason of promoting innovation is to mitigate negative external effects such as environmental pollution in agriculture and food production; or to mitigate territorial inequalities)

• The government has a great impact on innovation

• It has a direct and an indirect impact

• Direct impact: providing finance for innovation projects �

allocate financial resources to potential innovators

• Indirect impact: creating a favourable millieu for innovation �

setting up institutional ifrastructure, providing education,

training, research and extension, promoting networks etc.)

• AKIS can be an adequate vehicle for empowering farmers to

investigate new options to make their business more viable or

sustainable.

• An AKIS should be able

– to propose and develop practical ideas

– to support innovation, knowledge transfer and information exchange.

• In an ideal world AKIS would function as a closeley related and interconnected system.

• However, in reality, existing AKIS is often fragmented. �

this rises coordination issues.– Education is often weakly connected to research, extension and

business.

– Applied research is often reviewed on scientific output (which places great emphasis on peer reviewed publications), much less on practical relevance (research is often not sufficiently related to farm praxis).

• Different parts of AKIS, such as education, extension and

research face different challenges and they are governed by

different aspects which can be problematic for synergy and cooperation within an AKIS. � new approach needed; See

new paradigm next slide

Old paradigm New paradigm

• Each organisations acting primarily

within their own space

• Some degree of interaction, but

limited – each organisations acting

independently to influence the others

• Independently-defined roles of each

organisations

• Greater degree of activity to address

challenges within each sector and

more integration across a shared

space

• New frameworks for collaboration,

partnership and innovation

• Emergence of new (hybrid)

organisations (eg. EIP – European

Innovation Partnerships - Operational

Groups)WEF (2013 )

Science

Government

Business

• So, the AKIS is needed but it is not going to appear spontaneously, if so, than it is developing rather slowly, which takes lot of time and the result is uncertain.

• For that reason, development of AKIS should be stimulated and ecouraged, the coordination between actors should be facilitated.

• Innovation support will be strengthened in the EU’s

Common Agricultural Policy in the period of 2014-2020.

• In 17th December 2013, the European Parliament and the

Council adopted the new Rural Development Regulation (No

1305/2013).

• The regulation acknowledges the importance of research, knowledge transfer and innovation in addressing the

challenges faced by European farmers and it recognises the central role of Agricultural Knowledge and Innovation Systems (AKIS).

53

Rural development in a new framework (1)

Common Strategic Framework (CSF)– covering the EAFRD, ESF, Cohesion Fund and EMFF, and reflecting EU2020 through common

thematic objectives to be addressed by key actions for each of the funds

Partnership Contract– national document outlining the intended use of the funds in the pursuit of EU2020 objectives

Rural development policy: EAFRD

Other CSF funds(ERDF, ESF, Cohesion Fund the EMFF)

Rural Development Programme(s)

Europe 2020 strategy

Promoting social

inclusion,

poverty reduction

and economic

development

in rural areas

Enhancing

competitiveness

of all types of

agriculture

and farm viability

Promoting

food chain

organisation

and risk

management

in agriculture

Restoring,

preserving and

enhancing

ecosystems

dependent on

agriculture and

forestry

Promoting resource

efficiency and

supporting the shift

towards a low carbon

and climate resilient

economy in

agriculture, food

and forestry sectors

Fostering

knowledge

transfer and

Innovation in

agriculture,

forestry and

rural areas

Pri

ori

ties

Innovation, Environment and Climate Change as cross-cutting themes

5454

6. Social inclusion,

poverty reduction

and economic

development

in rural areas

2. Competitiveness

of all types of

agriculture

and farm viability

3. Food chain

organisation and

risk management

4. Restoring,

preserving and

enhancing

ecosystems

5. Resource efficiency

and shift towards a

low carbon and

climate resilient

economy

1. Knowledge

transfer and

Innovation

Innovation, Climate Change and Environment as cross-cutting objectives

Rural development priorities

Key Actions

(a) fostering innovation and the knowledge base in rural areas

(b) strengthening the links between agriculture and forestry and research and innovation

(c) fostering lifelong learning and vocational training in the agricultural and forestry sectors

(a) facilitating restructuring of farms facing major structural problems, notably farms with a

low degree of market participation, market-oriented farms in particular sectors and farms in

need of agricultural diversification

(b) facilitating generational renewal in the agricultural sector

(a) better integrating primary producers into the food chain through quality schemes,

promotion in local markets and short supply circuits, producer groups and inter-branch

organisations

(b) supporting farm risk management

(a) restoring and preserving biodiversity, including in Natura 2000 areas and HNV farming, and

the state of European landscapes

(b) improving water management

(c) improving soil management

(a) increasing efficiency in water use by agriculture

(b) increasing efficiency in energy use in agriculture and food processing

(c) facilitating the supply and use of renewable sources of energy, of by-products, wastes,

residues and other non food raw material for purposes of the bio-economy

(d) reducing nitrous oxide and methane emissions from agriculture

(e) fostering carbon sequestration in agriculture and forestry

(a) facilitating diversification, creation of new small enterprises and job creation

(b) fostering local development in rural areas

(c) enhancing accessibility to, use and quality of information and communication technologies

(ICT) in rural areas

The European Innovation Partnership

(EIP)„Agricultural Productivity and Sustainability“

• Europe 2020 Strategy: Crucial role of research and innovation

in preparing the EU for the future challenges

• The new CAP gives innovation a key role for sustainable

agriculture and rural development

• The “Budget for Europe 2020" under the CAP heading is about

4.5 billion Euros for research and innovation in the field of food

security, bio-economy and sustainable agriculture

• The Europe 2020 flagship initiative "Innovation Union" specifies

European Innovation Partnerships (EIP) as a new tool for

fostering innovation.

The aims of EIP

• Efficient, productive, climate and environment friendly agriculture

• Steady supply of food, feed and biomaterials, both existing

and new ones

• Improved processes to preserve the environment, adapted to

climate change and mitigation

• Building bridges between cutting-edge research knowledge

and technology and farmers, businesses and advisory services

Key acting entities within the EIP: OperationalGroups (Ogs)

Interplay and mediation between actors is key

To reach these goals the EIP must bridge the gap between research and farming practice

focussing on real, existing issues and research needs from the ‘field’ and involve all innovative

actors.

The Interactive Innovation Model

• The innovation model under the agricultural EIP goes far beyond speeding up transfer "from laboratory to market"

through diffusion of new scientific knowledge (referred to as a

"linear innovation model").

• The EIP adheres to the "interactive innovation model" which focuses on forming partnerships - using bottom-up

approaches and linking farmers, advisors, researchers,

businesses, and other actors in Operational Groups.

• This knowledge “exchange” will generate new insights and ideas and mix existing knowledge into focused solutions that are quicker put into practice.

– Such an approach will stimulate innovation from all sides and will help to target the research agenda.

Technology or market-driven innovation

Interactive innovation model, we can

call it as Challange-driven innovation

Key Acting Entities Within the EIP- Operational Groups -

Farmers

NGOs Advisors

Researchers

Agri-business Operational

Group

"Operational Groups" are no stakeholder networks, no stakeholder boards, no thematic

coordination groups, nor discussion groups

An OG = actors working together in a project targeted at innovation and producing concrete results

Operational Groups (OGs)

• An EIP operational group builds itself around a concrete innovation project targeted towards finding a solution for a

specific issue or developing an innovation opportunity

• OGs are action and result oriented “hands-on” (actively

participating actors) groups (no balanced representation

needed)

• OGs use interaction of actors of different backgrounds for co-creation and cross-fertilisation aiming at a concrete

project

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NWNW

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Conclusion (messages)

• System approach is needed, other tinking is not reality (when

we talk about complex systems)

• Changes increase the needs to adapt, which makes innovation

more and more important (essential)

• Adaptation must be enhanced � good news: it could also be

enhanced � but we have to work on it! (it does not happen by

accident)

• AKIS as a frame of interactive innovation; EIP is a tool to

enhance this type of innovation, which can be called challange-driven innovation � that can lead us to better understanding of

the situation, which can produce better responds, answers to

changes

Questions? Comments?

Thank you for your kind attention!

Krisztián Kis, PhDkisk@mk.u-szeged.huUniversity of Szeged, Faculty of EngineeringSzeged, Hungary